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Tuesday, June 21, 2022

Oil Up over Supply Concerns

Oil Up over Supply Concerns
© Reuters.

By Zhang Mengying

Investing.com – Oil was up on Tuesday morning in Asia as worries about tight supplies grew.

Brent oil futures rose 0.97% to $115.24 by 12:07 a.m. ET (0407 GMT) and crude oil WTI futures gained 1.99% to $110.14.

Investors are concerned about the tight supply as the West imposes sanctions on Russian oil. Questions also remain on how Russian production might fall because of sanctions on equipment needed for output, analysts said.

“The market remains cautious about disruptions to Russian oil as European sanctions kick in,” ANZ Research analysts said in a note.

The market is assessing the tension between supply concerns and uncertainty over global growth in the face of inflation and rising interest rates, analysts said. China also saw COVID-19 flare-ups in cities including Shenzhen, which added to concerns about weaker oil demand.

“It’s a tension that we’re going to see unfolding for the rest of this year,” Westpac senior economist Justin Smirk.

“There’s fear of a recession, but we’re not there. We’ve still got recovery coming through,” Smirk added.

Investors now await U.S. crude supply data from the American Petroleum Institute, due later in the day.

Source: Investing.com

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